South American countries are negotiating with pharmaceutical companies to obtain common cheaper prices for high-cost medicines. The first target of initial negotiations delivered lower prices for hepatitis C and HIV. Further negotiations are expected to be geared to additional hepatitis C, HIV and oncology medicines.

Middle-income countries have raised the issue of high-priced medicines for a long time, as they are not covered by global financing agencies such as the Global Fund to Fight AIDS, Tuberculosis and Malaria, and Gavi, the vaccine alliance. They also said in the past that despite their graduation from their status of developing countries, they host a large proportion of the world’s poor population, and that prices proposed by pharmaceutical companies rely on individual negotiations and as a result are very uneven, and lack transparency.

According to a press release by the Pan American Health Organization (PAHO), which serves as the regional office for the Americas of the World Health Organization, health ministers of the Mercado Común del Sur (Mercosur) and associated countries “have completed initial negotiations with a number of pharmaceutical companies on 13 November in Asunción, Paraguay, that will lead to the joint procurement of high-cost medicines,” with the support of PAHO.

The health ministers agreed to purchase darunavir, an antiretroviral medicine through the PAHO Strategic Fund, bringing the price down to US$1.27 per tablet, “significantly less than the lowest price previously available to any of these countries (US$2.98), resulting in cost savings of some US$20 million for participating countries.”

According to the release, “this price will be made available to any PAHO Member State that participates in the Strategic Fund.”

Also, Gilead, manufacturer of sofosbuvir, for the treatment of hepatitis C, offered the drug at the lowest current price in the region, paid by Brazil (US$ 81.85 per tablet). According to the release, “The ministries committed to evaluate additional offers received with a view to achieving consensus on the best options for procurement to treat hepatitis C.”

The release quoted James Fitzgerald, director of PAHO’s Department of Health Systems and Services, saying “This is a clear example of South-South collaboration towards universal health.”

PAHO supported this price negotiation as an observer, said the release, “providing technical assistance to the ministries of health, as well as through the structure of the PAHO Strategic Fund, a mechanism established by PAHO to support pooled procurement of medicines that meet international quality, safety and efficacy norms.”

The initiative of the health ministers of Mercosur (Argentina, Brazil, Paraguay, Uruguay and Venezuela) and associated states (Chile, Bolivia, Peru, Bolivia, Ecuador and Suriname) dates back to June, when they decided to take action to reduce the effects of what they called “abusive commercial practices,” and exorbitant prices of medicines, in a common statement.

They decided to establish a working group tasked with presenting possible actions to pool the purchase of medicines and get cheaper prices. Among the tasks of the working group was the exploration of bilateral or multilateral actions which would reinforce policies of universal access to medicines.

Some Pharmaceutical Companies Not On Board

According to a source, Janssen-Cilag, which was invited to join the meeting to negotiate prices last week for simeprevir, did not attend the meeting, and Bristol-Myers Squibb offered a price for daclatasvir which was about 500 percent higher than the one Brazil pays for it. Both medicines are related to hepatitis C. Further negotiations are expected to take place later this month with the two pharmaceutical companies.

A second round of negotiations is expected to take place to negotiate the purchase of other high-priced medicines, including further HIV drugs and oncology drugs, according to sources.

A release from the Argentinean Ministry of Health (in Spanish) is here.
A release from the Brazilian Ministry of Health (in Portuguese) is here.

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